Veterans benefits can provide more income for a Medicaid recipient’s spouse

Those familiar with veterans benefits for aid and attendance often think of them as a means to pay for care at home or in an assisted living facility.

But did you know aid and attendance benefits can provide extra income for the spouse of someone on Medicaid (at least in Pennsylvania)?

Here’s an example. Suppose John, a wartime veteran with a dependent spouse (Mary), has been receiving the maximum benefit for aid and attendance: $2,120 a month. But John has just moved to a nursing home and qualified for Medicaid.

To understand the effect on John and Mary’s income, you need to know that when a veteran with a dependent spouse receives benefits to help with long term care, those benefits have two components: (1) a low-income pension, and (2) housebound benefits or aid and attendance benefits. Veterans benefits are not reduced when the recipient has a dependent (such as a spouse) and later qualifies for Medicaid. Under Pennsylvania’s Medicaid regulations, the “aid and attendance and housebound allowance portion of a veterans benefit” does “not count as income” when determining a Medicaid recipient’s income. 55 Pa. Code § 181.81(9).

In John’s case, his veterans benefit of $2,120 a month breaks down into a low-income pension of $1,404, and aid and attendance benefits of $716. He can continue to receive benefits because of Mary, his dependent spouse.

Because the $716 aid and attendance benefit does not count as income, he can give it to Mary each month because it does not count as his income for Medicaid purposes. Mary receives this additional $716 a month in addition to all other income she would be getting.

What’s more, if John and Mary are both low income, some of the pension amount ($1,404) could also go to Mary as part of a monthly maintenance needs allowance permitted under Medicaid provisions. Whatever Mary doesn’t receive from the pension will go to the nursing home to help pay for John’s cost of care.

When your spouse is on Medicaid, an extra $716 a month or more can make quite a difference in your quality of life.

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About Andrew Sykes

The founder of Sykes Elder Law, Andrew Sykes is recognized as a leading elder law authority in Western Pennsylvania. Mr. Sykes is the past chair of the Elder Law Committee of the Allegheny County Bar Association.